Collectibles such as classic cars, fine wine, and rare coins are highly insulated from the seemingly insurmountable headwinds that investors face today.
By Paul Mershon
Something we have been saying to many of our private wealth clients for years is the importance of actual portfolio diversification into completely non-correlated asset classes. It’s not just about stocks and bonds anymore and hasn’t been for more than two decades, especially with the 10-year U.S. Treasury yield at an historically low rate of 0.84 percent.
I recently ran across this article published by Private Wealth Canada (privatewealthcanada.ca): “3 Tangible Asset Trends Emerging As Safe Havens Against Ominous Economic Outlook” which I believe summarizes some opportunities we have going forward for 2021.
Here is a short excerpt:
For many centuries, ultra-high end “blue chip” fine art pieces have been a store of value within the market, which has a long track record of price appreciation. However, after years of successfully institutionalizing this particular global sector and witnessing staggering price increases therein, trouble is brewing as demand from major art markets like London and Hong Kong falters due to geopolitics, trade wars and the global COVID-19 pandemic.
In other words, “Art Is Becoming Non-Starter.”
While fine art doesn’t paint a particularly pretty picture for investors, several other collectibles markets with significantly lower entry prices are emerging as asset classes worthy of serious consideration ‒ not only for investment but also offering many other non-financial benefits. Namely, the fine wine, rare coin and classic car markets.
Read the whole article here: